Pension Projection Models
The PSG models provide a broad range of pension analysis capabilities through the interaction of five properties.
First, the simulated sample of individuals is representative of the whole population. Some other pension models are based on selective subsamples of the population that are likely to produce biased estimates.
Second, the simulated individual life histories are complete from birth to death. Some other pension models are based on individual data starting in a certain year and do not have complete information on life events before that year.
Third, all types of employer-sponsored pensions are simulated. Some other pension models focus on only one one kind of pension (defined contribution plans, for example) and/or one kind of employer (private sector, for example).
Fourth, the detailed characteristics of each type of employer-sponsored pension are characterized and vary across industry and firm size. Some other pension models are hampered by a lack of important details on the characteristics of pension plans.
Fifth, the PSG models produce a large number of statistics for each simulated individual — on lifetime pension accumulation and on withdrawal over all retirement years — that can be tabulated in any way to support the analysis plan. Some other pension models provide information on only a few aspects of an individual's pension experience.
In addition to these five central properties, the PSG models can easily be used to test the sensitivity of tabulated pension statistics to changes in assumptions about future macrodemographic and macroeconomic environments, future employer offerings of pension plans, future employee pension behavior, and future government pension policy.
Other key features.